Why Your Clients Need E&O Insurance

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As an insurance agent or broker, you’ll find fresh evidence of the expanding nature of professional liability by glancing at almost any daily newspaper. People sue attorneys, accountants, engineers, architects, trust officers, insurance professionals, real estate agents, police officers and—last but certainly not least—hospitals, nursing homes, and all manner of physicians and health care professionals, seeking untold sums of money on the grounds that the defendant has breached some duty in the practice of his or her profession.

At one time, people didn’t sue attorneys, accountants, and other professionals very often and—when they did—they found it hard to win their cases. However, these days no lawyer, accountant, engineer, architect, trust officer, insurance professional, real estate agent. or health care professional would dream of doing business without professional liability coverage. The risks are just too great and it doesn’t matter how keenly the individual may feel that old sense of responsibility that is part of being a professional. The threat of litigation touches everyone who engages in commerce.

Errors and Omissions (E&O) Insurance

Errors and omissions (E&O) is the insurance that covers a professional services provider (or that person’s partners or firm) in the event that a client holds the provider responsible for services that did not have the expected or promised results. By not purchasing E&O, a company can be taking a serious financial risk. These types of losses are not covered under a general liability policy. (Note: For medical doctors, dentists, chiropractors, etc., this insurance is often called malpractice insurance. For lawyers, accountants, architects, or engineers, it may be called professional liability.)

Under an E&O policy, the insurance company will pay the insured’s legal for defending against liability actions taken by third parties and settlements or judgments (up to the stated limits of the policy).

A person or a company in the business of providing a service to clients for a fee needs E&O insurance, which is typically customized to meet specific needs of a business or industry. For example, a printer has different risks than an electrician does in a standard business day. Both have the need for liability insurance, yet each needs a completely different type of coverage. Clients must consider what will happen if a service is not done correctly or on time, and it costs your client money or harms their reputation. Even with the best employees and the best risk management practices in place, mistakes will be made. No one is perfect.

As an effective broker or agent, you can help your clients by identifying, analyzing, and quantifying the risks they face, and explaining the options in the clearest possible way. That being done, you can arrange am E&O policy with a bearable deductible and an intelligent limit—and assist your clients in controlling the risks that remain.

Want to know more about E&O insurance? Check out [add hyperlink to Advanced Thinking About E&O Insurance] our E&O insurance continuing education classes.

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Why Your Clients Need Cyber Risk Insurance

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Cyber crime is the fastest growing crime in the world. Criminals are exploiting the speed, convenience, and anonymity of the Internet to commit a diverse range of criminal activities. Common types of cyber crime include hacking, online scams and fraud, identity theft, attacks on computer systems, and illegal or prohibited online content.

New technology allows hackers to be even more anonymous and more dangerous when attacking computers, networks, or websites. Hackers understand the intense complexity of the World Wide Web, which changes every day. They know the weaknesses of the common browsers, programming languages, and operating systems. Modern cyber criminals might pretend to be a government agency, bank, or trusted friend in order to gain access to personal information.

According to Lloyd’s of London, cyber crime costs businesses up to $400 billion annually. As cyber crime increases, corporations, government agencies, and other entities will increase spending to defend and protect their digital networks and assets.

Cyber Insurance

Specialized cyber insurance policies have been developed by insurers to help businesses and individuals protect themselves from an ever-evolving range of risks. Recent market intelligence suggests that the types of specialized cyber coverage being offered by insurers are expanding in response to this fast-growing market need. As an insurance agent or broker, you should educate yourself about cyber insurance to assess the best coverage fit for your clients’ exposure. And all of your clients will have some exposure.

Cyber insurance is an insurance product used to protect businesses and individual users from Internet-based risks, and more generally from risks relating to information technology infrastructure and activities. Risks of this nature are typically excluded from traditional commercial general liability policies or at least are not specifically defined in traditional insurance products.

Most notably, cyber insurance policies cover a business’ liability for a data breach in which the firm’s customers’ personal information, such as Social Security or credit card numbers, is exposed or stolen by a hacker or other criminal who has gained access to the firm’s electronic network. The policies cover a variety of expenses associated with data breaches, including: notification costs, credit monitoring, costs to defend claims by state regulators, fines and penalties, and loss resulting from identity theft.

Specialized cyber risk coverage is available primarily as a stand-alone policy. Each policy is tailored to the specific needs of a company, depending on the technology being used and the level of risk involved. Policies may cover liability arising from website media content, as well as property exposures from: (a) business interruption, (b) data loss/destruction, (c) computer fraud, (d) funds transfer loss, and (e) cyber extortion. Depending on the individual policy, specialized cyber risk coverage can apply to both internally and externally launched cyber attacks, as well as to viruses that are specifically targeted against the insured or widely distributed across the Internet.

Want to know more about cyber risk insurance? Check out our cyber risk insurance continuing education classes.

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Musicians Investing in Terrorism Insurance Following Vegas Attack

Source: nypost.com

There’s been a high demand for terrorism insurance in the wake of the Las Vegas massacre — with artists from all music genres reportedly looking to invest in policies for their concerts.

“Now more than ever they are targets,” explained Steves Rodriguez, business manager for the all-girl pop group, Fifth Harmony.

Speaking to The Hollywood Reporter this week, he and other managers described how musicians were taking out terrorism insurance policies now — more than ever before — following the deadly mass shooting at the Route 91 Harvest festival on Oct. 1.
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HIPAA: Why We Needed It and What It Does

The Health Insurance Portability and Accountability Act (HIPAA) was introduced in 1996 by President Clinton. Its effects are broad and far-reaching, and it represents a major form of healthcare reform before the Affordable Care Act. When most people think of HIPAA, they think of privacy rules for patient information—but actually, HIPAA was introduced to help ensure coverage for people who changed jobs or lost their jobs. Prior to the introduction of HIPAA, there were no national-level safeguards for this, and insurers could and often did exclude pre-existing conditions for people who changed jobs (and thus insurance plans) or lost their jobs. Continue reading

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Hurricane Irma aftermath: Floridians without flood insurance face astronomical bills

Source: USA TODAY

FORT MYERS, Fla. — Anita Dennis talked on the phone with her homeowner’s insurance company, her furrowed brow expressing more than words could say.

The 72-year-old widow carried flood insurance on her home years ago, then let it lapse after learning her neighborhood in The Villas in south Fort Myers was expected to flood only every 100 years.

The house, built in 1973, has flooded twice in the past month.

Dennis shared her plight from the sweltering sunroom of her gutted, still-powerless home.

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